The price of premium music services have been pretty consistent for years at the $9.99. I currently have a Slacker Premium account and renewed again only because my Satellite subscription finally expired in my car and I found out really quick how bad the radio was. I don’t know that I get all the value out of my $10 subscription but for people like my wife and kids who spend as much as $700 dollars a year in music, it is a homerun. Problem is that they hate streaming. Mainly it is because they don’t understand it and take the time to learn downloaded playlists. The other issue is that there seems to be content missing more and more from streaming providers.
Apple is rumored to be changing the $10 dollar monthly subscription rate to just $5.00. Why when it seems to be rolling along so well? Apple claims that the average person downloads $60.00 dollars per year of music. So a $120 dollar a year subscription is not a good value for them. So lowering it to $5 a month would certainly attract more subscribers. I know that I would be converting my family over to it immediately and they can suck it up and learn the app. It’s not mentioned if Apple will also follow the Spotify model and offer family plans either.
So how does Apple get to $5.00? They seemed to have paid for the U2 free album but I can assure you it will not happen again on the price reduction to the Beats music subscription. Apple will be pounding music providers for cost concessions. It would certainly have an immediate impact for other music subscriptions as well who would reap the same benefit Apple did with lower music costs. With the lack of customer service Slacker has, I would certainly lean towards Beats as their app interface has come along way. Still not giving up my Bose for Beats Apple, so you might get my new music subscription but not my headphone dollars yet!
According to re/code, the changes could happen next year leading up to the Grammys if Apple is successful in getting the music industry to lower music costs.